Selling Off the Indebted
Provides a Look at Old-Fashioned Auctioneering
|By Victor Reklaitis, Daily Press, Newport
Va.McClatchy-Tribune Business News
Mar. 9, 2007 JAMES CITY -- With a strategic pause and a little cajoling, auctioneer Mark Motley tried to draw a bigger bid from the crowd.
"Are we all done?" Motley asked, slowing his bid calling as the sale price hit $2.5 million for a Ramada hotel on Richmond Road. "Everybody think about it before you walk away. Don't be mad at us because you didn't bid."
His approach worked. Motley's patter then tracked the price as it climbed higher, first to $2.55 million and finally to $2.6 million. With a 5 percent fee for the auctioneer and other brokers factored in, the total price was $2.73 million.
Thursday's auction typified these public sales, Motley said. He said many of the auctions run by his Richmond-based Motley's Auction & Realty Group take about as much time -- five minutes or so -- and attract about the same number of people -- roughly 60, including about 15 people who registered to bid.
Sanket Patel, a 24-year-old businessman from Maryland, put in the highest bid Thursday for the run-down, 39-year-old hotel. His bid fell below the property's assessed value of about $3.3 million.
"The price is right for the property, and I think the location is good," he said. Patel said he and his father, the principals in Odenton, Md.-based Pioneer Contracting, develop hotels and also serve as contractors for transportation projects.
The Williamsburg area's hotel market registered an average occupancy rate of 47.7 percent in 2006, lagging all of Virginia's other hotel markets for the second year in a row. But Patel said he believes Williamsburg-area hotels that aren't up to national standards skew that rate, adding that his property will do well by offering suite rooms and new construction. He plans to knock down most of the existing 164-room hotel and eventually open up two smaller hotels on the 3.2-acre property, he said.
Thursday's auction happened after a bank foreclosed on Delaware-based Golden Knights Inc., which had owned the property since October. Former Williamsburg Mayor Gil Granger -- who sold this Ramada Inn & Suites and the nearby America's Best Value Inn & Suites to Golden Knights five months ago -- was among the onlookers at the auction. Granger said he attended because he might have had to repossess the Ramada property.
Copyright (c) 2007, Daily Press, Newport News, Va.
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